Following the UK’s vote to leave the EU, there has been much speculation as to what, if any, changes we might see to UK law. That is particularly so in the employment law sphere as EU law, or at least UK interpretation of it, features heavily in the employment law statute book.
The UK Government has recently announced a consultation on possible changes that it would like to make in three key areas, ostensibly to cut the ‘red tape’ on business.
The consultation paper confirms the legislation that the Government intends to preserve. That is as follows:
· Maternity and Parental Leave etc Regulations 1999;
· Paternity and Adoption Leave etc Regulations 2002;
· Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000;
· Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002;
· Agency Workers Regulations 2010;
· Information and Consultation of Employees Regulations 2004;
· Transnational Information and Consultation of Employees Regulations 1999;
· Working Time Regulations 1998 (WTR) and the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE), with the exception of the particular issues where changes are proposed – see below.
From the list above, you would be forgiven for thinking that the status quo is being preserved (phew cry the employment lawyers and HR professionals) but there are three specific areas where the Government is consulting with a view to amending current legislation. There are also some revocations, principally in relation to posted workers which no longer apply following our departure from the EU.
The specific consultation areas are:
1. Removing the record-keeping requirements under the WTR;
2. Simplifying annual leave and holiday pay calculations in the WTR 1998; and
3. Reforming the consultation requirements under the TUPE regulations.
Looking at those in turn, the proposals are:
1. Removing the record-keeping requirements under the WTR
The current system requires that employers must keep records of daily worked hours for a period of two years so that employers can show compliance with the weekly hours limits and the daily and weekly rest periods.
The UK Government believes that is too onerous a requirement and so is consulting on whether these requirements should be removed.
2. Simplifying annual leave and holiday pay calculations in the WTR
i. Ordinary and additional leave
The current regime in the WTR separates out the 4 weeks provided for in the EU legislation (the Working Time Directive) and the 1.6 additional weeks of leave provided in the UK, which is equivalent to the amount of UK bank/public holidays.
As a result of the origin of the two different types of leave, the rules governing them are slightly different (in relation to carry over, for example) and so the UK Government is proposing merging them together to make things easier.
ii. Calculation of holiday pay
The Government is seeking views on how holiday pay should be calculated and whether the “normal remuneration” principle which comes from EU case law should apply to all leave.
In addition to this the Government is seeking views on how to calculate holiday pay in the first year of employment. Currently, leave accrues at 1/12 of the annual entitlement for each month of service but, as a month is not a standard length and presumably because not everyone is paid monthly, the Government feels that calculating pay on that basis could be simplified.
iii. Allowing rolled up holiday pay
Current EU law currently does not allow rolled up holiday pay on the basis that it discourages people to take holiday (and thereby relax and recharge) if they can elect to be paid for it instead.
The Government however feels that particularly in the gig economy that rolled up holiday pay makes sense and so is consulting on the issue.
3. Reforming the consultation requirements under the TUPE regulations
Currently where a business is to be transferred the transferor has to allow the appointment of reps for the purpose of informing and consulting with its employees. There is an exemption to that (allowing the transferor to consult individually) for micro businesses, which are those with fewer than 10 employees.
The government is proposing to remove the requirement to elect employee representatives for the purpose of TUPE consultation for:
· Businesses with fewer than fifty employees or
· Businesses of any size involved in a transfer of fewer than ten employees.
In both situations, businesses meeting these criteria will be able to consult directly with employees, where no existing employee representatives are in place.
It is worth stressing that these are only proposals which are subject to consultation. The exact changes to legislation, if any, are not yet known. At the moment the existing rules in these areas continue to apply.
If you have any questions about this or any other area of employment law then please get in touch.